Bitcoin drops to $34,142 amid China mining crackdown; Ether declines 5.9%

Bitcoin fell over the weekend amid a focus on Chinese mine closures and potential regulatory scrutiny.

The largest cryptocurrency fell 5.5% to $ 34,142 at 10:50 a.m. on Sunday in New York, falling for the fourth time in the last five sessions. Ether, the second largest, fell 5.9% to $ 2,095.

The hash rate in China is dropping significantly as bitcoin mines close, wrote Jonathan Cheesman, head of off-market and institutional sales at the FTX crypto derivatives exchange in an email on Saturday, citing Twitter reports from handle @bigmagicdao.

“In the longer term, most view hashrate exodus from China as positive, but could have led to inventory sales in the short term,” said Cheesman.

READ | China’s crackdown on cryptocurrency mining spreads to Sichuan

Cheesman also mentioned the Death Cross, which occurs when the 50-day moving average falls below the 200-day average, but noted that “backtesting is not statistically significant” on the signal for Bitcoin, which was the prelude, for example a year-long rally.

Cryptocurrencies have been going through a lull recently. Bitcoin is trading at roughly half of its record high of nearly $ 65,000, which it hit in mid-April. The market value of all cryptocurrencies is around $ 1.45 trillion as measured by CoinGecko, up from a high of around $ 2.6 trillion last month.

One of the factors mentioned was concerns that China is curtailing mining due to concerns about energy use and following fatal coal accidents.

The city of Ya’an in the southwestern Sichuan region has promised provincial authorities to eradicate all bitcoin and ether mining operations within a year, said a person familiar with the situation. The closure of many bitcoin mines in the province has shut down more than 90% of China’s bitcoin mining capacity, according to a report by the Communist Party-backed Global Times.

According to an estimate by the University of Cambridge, around 65% of global bitcoin mining took place in China in April 2020.

In addition, Edward Moya, chief market analyst at Oanda Corp., said that Bitcoin was put under pressure by the sudden drop in the Titan token to almost zero – a stablecoin that even attracted billionaire Mark Cuban. Regulators had already raised concerns about stablecoins, and Cuban itself encouraged further regulation of the room after the episode.

“Bitcoin crashed when the demise of the Titan token increased pressure from regulators to provide more protection for the public,” Moya said in an email on Friday. “Titan’s crypto crash came as a surprise to many as it is a partially secured stablecoin. Given the risk-off environment hitting Wall Street, cryptocurrencies are under pressure. “

This story was posted from a news agency feed with no changes to the text. Only the heading was changed.

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